Foreign traders were provided with facilities in most countries in return for the payment of taxes and customs duties. In certain instances the rulers themselves participated in sea-borne trade by having direct contact with foreign traders and organizing their own ships.

Because of Sri Lanka's central position in the Indian Ocean along maritime trade routes and its numerous bays and anchorages providing adequate facilities for ships, the island was a centre of transit trade from very early days. Its natural products such as gems, pearls, ivory and spices made the island an important centre for exports. The monarchical and semifeudal socio-political structure of the island led to a demand for luxury commodities imported from abroad.

The island was connected by sea routes with ports in the southern, western and north-eastern regions of the Indian Sub-Continent and also with ports in the Arab world as well as South-East Asian Kingdoms and through the latter with China. Several Sri Lankan ports played important roles in maritime trade carried through these sea-routes but the importance of some of these ports varied from time to time.

In the period prior to the thirteenth century Mahatittha or the great port, opposite Mannar on the north-western coast facing the Arabian Sea was the most important trading port of the Island. A large number of articles of foreign origin including coins and porcelain-ware have been excavated at Mahatittha by archaeologists. In Sinhalese inscriptions and Pali chronicles Mahatittha is variously referred to as Mahavoti, Mahaputu, Mahavatu, Mahavatutota, Mahapattana and Matota while it is called Mattottam in Tamil.

It was the most important port for vessels coming from South India and there was a strong South Indian element in the population of this port during most periods of history. Mahatittha located at the mouth of the Malvatu river had easy access to the capital Anuradhapura, which was located on the banks of the same river. However with the increased emphasis on the South-East Asian Sri Vijayan Kingdom as the main centre of entrepot trade after the seventh century A.D. the importance of the port of Mahatittha had diminished to some extent. Owing to this change even the capital Anuradhapura lost much of its attractiveness.

After the seventh century, the principle arena for the East-West exchange trade had shifted from the Arabian Sea to the Bay of Bengal. Consequently there was an increasing interest in the north-eastern zone of Sri Lanka wherein was located Gokanna (Trincomalee) port. It is significant that between seventh and tenth centuries A.D. four Sinhalese Kings Aggabodhi IV, Aggabodhi VII, Udaya I and Sena I left Anuradhapura and ruled from the north-eastern city of Polonnaruwa, situated on the banks of the Mahaweli Ganga within easy access to Trincomalee.

Thus, the emergence of Polonnaruwa and the port of Gokanna is significant in terms of the changing patterns of trade in the Bay of Bengal and Sri Lanka's interest in it. The South Indian Chola occupation of Polonnaruva (1017-1070) was partly motivated by the commercial policy of the Cholas aimed at controlling the western sea-board of Bay of the Bengal. The importance of Gokanna for the Bay of Bengal and South-East Asian trade was realized also by the Sinhalese rulers of Polonnaruva particularly Vijayabahu I (1070-1110) and Parakramabahu (1153-1186).

However Mahatittha did not completely lose its glamour in the period between the seventh and the twelfth centuries and it functioned as an important trading centre where South Indian merchants flourished. In addition to the ancient temple of Tiruketisvaram at Mahatittha another temple named Rajarajavarattu Mahadeva was constructed near the port in the eleventh century for the worship of the trading communities and soldiers living there by the Chola conqueror Rajaraja I.

The new commercial policy of the southern Sung dynasty (1127-1278) of China deviated from the "tributary trading system" in south East Asian and South Asian waters. As a result, the role of the intermediaries in the Bay of Bengal trade declined drastically. Once again the coastal ports in India regained their eminent position in trade and the theatre of activity shifted from the Bay of Bengal to the Arabian Sea.

Mahatittha continued as the chief port of Rajarata at least up to the middle of the thirteenth century. The Rasavahini written in the Polonnaruva period implies that traders collected various commodities from Mahatittha and sold them in the interior. The Saddharmalankara refers to a merchant of Mavatupatuna who went eastwards for trade. However, by the fifteenth century Mahatittha appears no longer to be an important port. The Kokila Sandesa written during the reign of Parakramabahu VI of Kotte, in giving a description of the important places along the western littoral of the Island does not mention Mahatittha.

In the Jaffna Peninsula there were two important ports Jambukolapattana and Uraturai. Jambukolapattana which can be identitified with modern Kankesanturai is not mentioned as a port of maritime commerce but was widely used as a port of embarkation and landing in the Anuradhapura period. Its importance is testified to by the fact that there was a connecting high road from Jambukolapattana to the capital Anuradhapura.

The other port in the Jaffna Peninsula, Uratota or modern Kayts attained importance as a port of maritime commercial activity especially during the time of the Polonnaruva kings. The Nainativu Tamil inscription datable to the reign of Parakramabahu I, suggests that foreign vessels laden with merchandise arrived at the port of Uraturai. This edict, besides proclaiming that foreign traders should be given the due protection, contains regulation regarding wrecked ships which brought in merchandise.

A Chola inscription datable to 1178 A.D. refers to the building of ships and the assembling of troops at Uraturai by Parakramabahu I during his South Indian campaigns. Both Jambukolapattana and Uraturai would have continued as important ports connecting South India and Jaffna even in the fourteenth, fifteenth and sixteenth centuries A.D. as rulers of Jaffna maintained close contacts with South India.

Several other less important ports of the north, north western and eastern coast are referred to in the Culavamsa as ports of the Island in the twelfth century. The port from which Parakrambahu I's expeditionary force set sail for Burma was Pallavavanka. This has been identified by Codrington as modern Palvakki four miles north of Kucaveli. Although the Culavamsa reference is the only one made to this port it can be inferred that this was a port of some importance as it would not have been used as a base for a critical invasion had facilities for launching an invasion not been available there. Another port Madupadatittha was a landing place occupied by Magha in the thirteenth century. According to Nicholas the name may be preserved in modern Illupakadavai.

The landing places on the north-west or north coast which though referred to in the chronicles cannot be identified are Mattikaratittha, Pulacceri, Bhallatittha and Deberapatan. None of these ports, however seem to have been played any significant role in inter-oceanic trade.

Although the ports in the south are not mentioned like those in the northern, north-western and eastern parts of the Island in the early period of the Anuradhapura kingdom, one exception is the port of Godapavata (Godavaya) in the Hambantota district. In an inscription of Gajabahu I (114-136 A.D.) found at Godavaya near the mouth of the Walave Ganga, it is stated that the customs duties obtained at the port there were dedicated to the Godapavata Vihara. Nicholas points out that the appearance of the little bay at Godavaya today does not suggest that Godapavata port was more than a place of hazardous anchorage for an occasional sailing ship in times past.

The ports of the south and south-western coast however became important in international commerce after the drift of the political centres to the south-western regions of the Island. Perhaps international trade could have been one of the important factors influencing the Sinhala rulers in the choice of capitals in the south-western regions.

One of the natural ports in the south, Galle had gained prominence at least by the middle of the fourteenth century. Ibn Batuta states that he journeyed from Dondra(dinavur) to Galle(quali) and that he was treated by a Muslim named captain Ibrahim at Galle who had a residence in the town. The Chinese junks that came through the Straits of Malacca touched at Galle. The Galle Trilingual slab inscription datable to the first few decades of the fifteenth century written in Chinese, Persian and Tamil indicates that Chinese, Muslim and South Indian Hindu and Jain traders frequented the port. The fact that Galle had been a well established commercial centre by the fifteenth century is also attended by Sandasa poems. It was a town with wide streets beside which were locatded shops of all kinds.

Dondra was another important commercial port in the south in the thirteenth, fourteenth and fifteenth centuries. The Dondra inscription of Parakramabahu II (1236-70) contains regulations to prevent evasion of customs duties at the port of Dondra by traders. According to this epigraphs the sea port of Devinuvara or Tendiratota was administered by an officer titled Mahapandita. Customs duties were imposed by Mahapandita and merchants were safeguarded from illegal imposts. Those coming from foreign countries were not allowed to set up places of business without permission and royal officials were required not to accept gifts from foreign merchants. Parevi and Hamsa Sandesas also refer to Dondra as a flourishing trade centre in the fifteenth century. The Galle Trilingual slab inscription informs us that the Chinese emperor sent various kinds of offerings through his envoys including gold, silver silks and sandalwood to the temple at Dondra which was probably constructed by a princeling of southern Sri Lanka in the seventh century A.D. and was dedicated to Varuna the guardian god of the sea.

The port of Weligama too, had come into prominence at least from the twelfth century A.D. onwards. It is first mentioned as a port where affluent merchants dwelt during the reign of Parakramabahu I. The Kalyani inscriptions state that a ship sent by the Burmese King to Sri Lanka arrived at Weligama. The Tisara, Parevi and Kokila Sandesas indicate that Weligama had become an important and prosperous port about the fifteenth century.

It was predominantly settled by Muslims whose background and interests were entirely commercial. They spoke Tamil and sang Tamil songs. In this connection we may note the Portuguese writer Barbosa's statement that many Malabar ‘Moor’ came to live in Sri Lanka as it was luxuriant and healthy.

With the shift of the political centres to the south-west and the development of the south-western parts of the island several other ports such as Beruwela, Bentota, Wattala and Chilaw too turned out to be of significance in the island's trade with foreign countries. According to the Parevi, Gira and Kahakurulu Sandesas, large groups of sailing ships could be observed regularly from several points of the western coast. In the fourteenth century, John De Marignolli arrived by ship at the port of Perivils in Sri Lanka on his way to China.

According to Henry Yule, Perivills was the port of Beruwela. From Marignolli's account it may be inferred that Beruwala was settled by Muslims. He states that the administrator at Perivills was Coya Jhan, apparently the name of a Muslim chief. From the Sandesa poems it can be ascertained that Beruwala was a Muslim trading centre in the fifteenth century with many beautiful mansions and large shops.

Salawata or Chilaw was also an important landing place from the twelfth century onwards. Between 1188 A.D. and 1200 A.D. the Cholas landed at Salavattota. The Dambadeni Asna refers to the landing of foreigners at the same port. According to the Nikaya Sangrahaya in the middle of the 14th century the Arya Cakravarti had encampments at Colombo, Wattala, Negombo and Chilaw. At the time the rulers of Jaffna apparently attempted to control Sri Lanka's foreign trade.

Colombo, the most important port of the island today was a town largely inhabited by Muslims whose presence there can be traced as far back as the tenth century A.D. According to Iban Batuta, Colombo (Kalanbu) was the greatest city of Serendib. He further states that Colombo was controlled by a person named "Jalasti" who had five hundred Abyssinians under him. Batuta describes Jalasti as a prince of the sea which indicates that Jalasti had been actively engaged in foreign trade. When the Portuguese arrived in Sri Lanka in the beginning of the sixteenth century Colombo was the island's major port.

Sri Lanka's foreign trade and the international sea borne commerce in the Indian Ocean underwent many changes with the advent of the European powers in the Indian Ocean. The Portuguese in the 16th century and subsequently the Dutch, the French and the British dominated sea-borne commercial activity in the Indian Ocean.

In order to monopolize the export trade of Sri Lanka, the Portuguese and the Dutch attempted the territorial conquest of the Island. In 1815, the British succeeded in gaining supremacy over the whole island. Under their rule, plantation agriculture was given priority as a result of which tea, rubber and coconut became the main exports of the island. Sri Lanka became a dependency of the West and turned out to be a market for western products. It was the commercial or economic interests of the West which paved the way for the transformation of the island's whole political and social structure.